SIFMA provides comments to the Securities and Exchange Commission (SEC), on behalf of its Division of Risk, Strategy, and Financial Innovation (“Division”), with regard to the studies required under Section 417(a)(2) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”). More specifically, Section 417(a)(2) requires the Commission to conduct a study of: 1) the feasibility, benefits, and costs of requiring reporting publicly, and in real time, short sale positions of publicly listed securities, or, in the alternative, reporting such short sale positions in real time only to the Commission and the Financial Industry Regulatory Authority, Inc. (“FINRA”), and 2) the feasibility, benefits, and costs of conducting a voluntary pilot program in which public companies will agree to have all trades of their shares marked “short,” “market maker short,” “buy,” “buy-to-cover,” or “long,” and reported in real time through the Consolidated Tape.

SIFMA firms believe that short selling is a longstanding, legitimate practice that provides numerous benefits to the market. The SEC’s Release includes an extensive request for comment on a variety of topics involving disclosure of short sales and short positions. We strongly urge the Commission to consider the policy goals further, and engage in a thorough cost-benefit analysis, prior to adopting rules governing additional disclosure of short sales and short positions.